Correlation Between Changchun BCHT and Guangdong Transtek
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By analyzing existing cross correlation between Changchun BCHT Biotechnology and Guangdong Transtek Medical, you can compare the effects of market volatilities on Changchun BCHT and Guangdong Transtek and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Changchun BCHT with a short position of Guangdong Transtek. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changchun BCHT and Guangdong Transtek.
Diversification Opportunities for Changchun BCHT and Guangdong Transtek
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Changchun and Guangdong is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Changchun BCHT Biotechnology and Guangdong Transtek Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Transtek and Changchun BCHT is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Changchun BCHT Biotechnology are associated (or correlated) with Guangdong Transtek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Transtek has no effect on the direction of Changchun BCHT i.e., Changchun BCHT and Guangdong Transtek go up and down completely randomly.
Pair Corralation between Changchun BCHT and Guangdong Transtek
Assuming the 90 days trading horizon Changchun BCHT Biotechnology is expected to under-perform the Guangdong Transtek. But the stock apears to be less risky and, when comparing its historical volatility, Changchun BCHT Biotechnology is 1.47 times less risky than Guangdong Transtek. The stock trades about -0.07 of its potential returns per unit of risk. The Guangdong Transtek Medical is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 973.00 in Guangdong Transtek Medical on October 16, 2024 and sell it today you would earn a total of 239.00 from holding Guangdong Transtek Medical or generate 24.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changchun BCHT Biotechnology vs. Guangdong Transtek Medical
Performance |
| Timeline |
| Changchun BCHT Biote |
| Guangdong Transtek |
Changchun BCHT and Guangdong Transtek Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changchun BCHT and Guangdong Transtek
The main advantage of trading using opposite Changchun BCHT and Guangdong Transtek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changchun BCHT position performs unexpectedly, Guangdong Transtek can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Guangdong Transtek will offset losses from the drop in Guangdong Transtek's long position.| Changchun BCHT vs. Weihai Honglin Electronic | Changchun BCHT vs. Semiconductor Manufacturing Electronics | Changchun BCHT vs. Integrated Electronic Systems | Changchun BCHT vs. Success Electronics |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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